Hollywood writers strike over influx of wages after talks fail

The simmering row over how to compensate writers in the era of streaming came to a head Monday night, as leaders of the Writers Guild of America called on their members to stage Hollywood’s first strike in 15 years.

The boards of directors of the WGA’s West and East Coast Divisions voted unanimously to call a strike starting at 12:01 a.m. Tuesday, the union said in a statement.

Thousands of WGA members were set to march in picket lines across Los Angeles, New York and other cities on Tuesday after the union was unable to reach a last-minute agreement with major studios on a new three-year contract to replace one that expired Monday night. .

“The companies’ behavior has created a labor-based economy within the unionized workforce, and their steadfast stance in these negotiations has demonstrated a commitment to further devaluing the writing profession,” the WGA said in a statement. “Such a deal could never have been contemplated by this membership.”

In a statement, the Film and Television Producers Alliance said it had provided “generous increases in compensation for writers as well as improvements to the tailings stream.”

The alliance, which is negotiating on behalf of the major studios, said it was willing to improve the show but was “unwilling to do so because of the amount of other proposals still on the table that the syndicate continues to insist on.” The coalition said the main sticking points include union demands on mandatory staffing levels and length of staffing.

The book is looking for a bigger slice of the broadcast pie that has fundamentally transformed the world of television. They voted by a historic margin in favor – 98% to 2% – to grant the strike permission their leaders seek if they cannot reach a deal on a new film and television contract on behalf of their 11,500 members.

The strike, which could last for weeks or months, is expected to shut down much television and film production nationwide and to reverberate throughout Southern California, where support homes, caterers, florists and others rely heavily on the entertainment economy. A previous writers’ strike in 2007 rattled the industry and lasted 100 days.

The closure will also mean the loss of temporary jobs for crew members and comes at a difficult time for the Los Angeles area, as many businesses are still trying to recover from the effects of the pandemic and major employers are cutting salaries. Hollywood studios laid off thousands of workers as Wall Street investors punished them for losses associated with their streaming business.

Even before negotiations between the WGA and the Alliance of Motion Picture and Television Producers began on March 20, many in Hollywood thought a strike was inevitable because the two sides had stayed out on some key issues even as the contract deadline approached.

WGA leaders have warned that their members face an “existential” threat to their ability to make a living in Hollywood.

Although broadcasting was a boon for television, it turned the way writers compensate on its head. The writers say they work longer hours for less pay and can no longer count on the steady stream of residual income they used to have in the days of broadcast television, when hit shows continued for years to rerun syndicated or once-profitable shows. home video market.

The average weekly wage for writer-producers has fallen 23% over the past decade when adjusted for inflation, according to a WGA survey. When accounting for inflation, screenwriter salaries have fallen 14% in the past five years, the report said.

The union demanded compensation and other improvements worth about $600 million, including increases in the minimum wage, residual flow and higher contributions to the WGA’s health and pension plan.

In addition, the union wants to crack down on practices it says have eroded writers’ salaries, such as the proliferation of so-called pick-rooms, where small groups of writers are hired in short series of requests to craft the show’s arc by. was commissioned, replacing the traditional practice of producing pilot episodes.

For their part, the major studios have said their goal is to strike a fair deal. They cited their own set of challenges, including pressure from investors to cut costs and build a profitable streaming business, a slowing national economy and a long-term decline in box office revenue. Amid the turmoil, companies like Netflix and Warner Bros. Discovery and Disney are laying off thousands of employees.

“AMPTP member firms remain united in their desire to strike a deal that is mutually beneficial to writers and the health and longevity of the industry, avoiding the hardship faced by the thousands of employees who depend on the industry for their livelihoods,” the alliance said in a statement.

It is uncertain how long such a withdrawal will last, especially if there is no unified leader for both sides as in previous strikes. In 2008, it was Walt Disney CEO Bob Iger and then News Corp. President Peter Chernin who brought the two sides together.

The variable nature of AMPTP has also complicated the picture due to the diverse interest of its members. Now tech companies like Amazon and Apple, whose core business isn’t entertainment, have a seat at the table along with Hollywood-focused companies like Walt Disney Co. and Paramount Global and Warner Bros. Pictures. Discovery. Netflix, which was only a mail-order DVD company during the recent strike, is also a key member of the Bargain Alliance.

Studio executives said they did not want a strike, but prepared for the outcome.

“A strike will be a challenge for the entire industry, and for every participant,” Warner Bros. Discovery CEO David Zaslav told attendees at a presentation for the streaming service, Max. We assume the worst from a business perspective. We have prepared ourselves. We have a lot of content produced.”

Warner Bros. has taken over. Discovery and the studios took various contingency measures for months in the event of a strike, including speeding up deadlines for scripts and film shoots.

The impact of the hit on major studios will vary. Some have a deep library of shows and movies on hand that they can offer to keep viewers watching.

Netflix may have an advantage over other studios because it has a large international production presence. Many of the most popular shows and movies are produced in countries like South Korea and Thailand.

In an April earnings presentation, Netflix co-CEO Ted Sarandos said the company wants to avoid a strike, but if there is a strike, the operator has enough content that it could “probably serve our members better than most entertainment companies,” he said. .

“An extended strike lasting more than three months should benefit Netflix meaningfully,” Rich Greenfield, co-founder of LightShed Partners, a technology and media research firm in New York, said in an April research note.

Some analysts point out that cutting costs from not having to produce shows could actually benefit studios.

For example, studios can use downtime to terminate costly contracts with writers through so-called “force majeure” clauses that allow a studio to end a deal if there is labor action that continues for a set period of time.

“Although we wouldn’t expect Warner Bros. to end deals with superstar writers like Chuck Lorre or Universal with Dick Wolf, there are lesser-known writers who have cut blanket deals with studios that make no economic sense today,” Greenfield wrote.

Although the WGA strike had widespread support from other Hollywood unions, a prolonged strike would result in hardships for a wide range of workers. During the recent strike, many of those who lost their jobs—such as set decorators, lighting technicians, and make-up artists—did not get their jobs back because studios scaled back production. The 2007 strike led to $772 million in lost salaries for writers and production workers, according to Los Angeles County Economic Development Corp.

The WGA has a strike fund to provide grants or loans to help its members make ends meet during the downtime. The WGA had $19.8 million in assets in its strike fund as of March 31, 2022, according to its most recent annual report.

Times staff writer Meg James contributed to this report.